RBS braced for ANOTHER year of losses: Taxpayer-owned bank set to reveal it's still in the red amid concerns over EU lenders

Royal Bank of Scotland is on course for a ninth consecutive year of losses amid fresh concerns over the health of lenders across Europe.

The taxpayer-owned bank is this week expected to reveal it remained stuck in the red in the second quarter of the year following a loss of £1billion in the first.

That would put it on course for another full-year loss – the ninth in a row since the financial crisis in 2008.

Still failing: RBS is this week expected to reveal it remained stuck in the red in the second quarter of the year following a loss of £1bn in the first

Banks are also braced for another week of turmoil on the markets after they failed to get a clean bill of health in the latest ‘stress’ tests.

Lenders from Italy, Ireland, Spain and Austria fared worst in the audit by the European Banking Authority, which examines what the banks have done to prepare for a future financial crisis, including how much capital they keep in reserve.

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But the results also raised concerns over the future of RBS, as the tests revealed that it would be the third worst hit major bank in Europe in a new economic crisis.

The results of the tests were published after global markets closed on Friday night – paving the way for a volatile start to trading today.

‘While we recognise the extensive capital raising done so far, this is not a clean bill of health,’ said EBA chairman Andrea Enria. ‘There remains work to do.’

Banking shares in Britain and across the Continent have been hammered since the UK’s vote to leave the European Union.

And results from RBS and HSBC will be pored over by investors this week amid worries about banks across Europe.

HSBC is expected to report a 20 per cent fall in first-half profits on Wednesday as it continues to reduce the size of its sprawling business around the world. The slump has raised questions over the bank’s dividend.

Taxpayers still hold a 73 per cent stake in RBS following its £46billion bailout in 2008 but the bank is struggling to return to profit as it battles legal issues in the US, huge restructuring costs and bad loans.

But former Tory chancellor Lord Lamont urged people not to be overly concerned about RBS’s position and said the real danger came from continental institutions.

‘I think the focus of attention is more on other banks,’ he said.

Raising concerns about the health of lenders in Italy, Germany, Portugal and Greece, Lamont said: ‘That is where it is thought there is a lot of weakness in the European banking system.’

He warned that the situation in Italy and other countries ‘could create a real political crisis’ for Europe which would impact on the UK.